Our Bureaus A clear picture on whether Jet Airways pilots will accede to the management’s request to take a pay cut from this month is expected to emerge in 10 days after an open meeting of the pilots in Mumbai. The pilots claim they are been asked to take a 15 per cent cut in their salaries.

The request to Jet pilots and some other employees came after the management asked the senior leadership team to take a pay cut to tide over the tough times that the company is facing. At the moment, the department heads are being asked to consider a pay cut.

The airline currently has about 16,000 employees and a fleet of 121 aircraft.

The employee cost as a percentage of operating income ranges between 11.5 per cent and 13 per cent for the domestic aviation industry, said Kinjal Kirit Shah, Vice-President, Corporate Sector Ratings, ICRA.

A Jet spokesperson said the airline is committed to creating a competitive cost structure that ensures a sustainable future for the airline and its stakeholders. “As part of its cost rationalisation measures the airline continues to evaluate all initiatives to achieve greater business efficiencies. Payroll is one of the important components of the airline's cost structure and the senior leadership team has undertaken a reduction in their salary to lead by example,” the spokesperson said.

At the moment it looks like the pilots are unlikely to accept the request.

Wage talks

While the pilots declined to be quoted, they pointed out that the management move comes on the eve of twage revision negotiations that happen every three years.

“If the airline has money to pay for 225 aircraft that have been ordered and also pay huge salaries to expatriaties, why grudge us our dues,” argued a pilot.

The industry is facing tough times with exchange rate fluctuations, northward movement in the prices of aviation turbine fuel and huge induction of aircraft by almost all the major players.

The adverse conditions in the domestic market have already taken a toll on IndiGo, the Delhi-based low-cost airline. IndiGo reported a close to 97 per cent drop in profit after tax of ₹ 27.8 crore for the quarter ended June 2018

The airline attributed the drastic fall in profits to the adverse impact of foreign exchange, high fuel prices and the competitive fare environment.